What a lot of people outside of the real estate industry (and many in it) don't realize is that possession doesn't necessarily have to happen at or some time after closing. In fact, under some circumstances, it's possible to get possession of a home prior to closing.
When Can You Take Pre-Possession of a Home?
While there are no hard and fast rules about when it's appropriate to take pre-possession of a home, the most common scenarios include:
- Seller has vacated the property
- Buyer is in a particular situation that requires them to move into the house prior to closing (e.g. an upcoming lease deadline)
- The loan has been cleared to close, or has a high probability of being cleared to close
Does Pre-Possession Cost Any Money
Generally speaking, there is usually some "rent" amount associated with taking pre-possession of a property, though it's not mandatory. It's not uncommon for short periods of a time (a week or less) not incurring any costs at all. However, for more extended periods of pre-possession, is not uncommon to have a nominal fee charged for taking possession of the property prior to closing.
Who Is Responsible for the Property During Pre-Possession?
If the buyer is taking pre-possession of the property, he or she becomes entirely responsible for the condition of the home, including pre-existing conditions not addressed during the inspection phase. This does not preclude the necessity for an inspection, but damage or maintenance items that come up during pre-possession are generally the responsibility of the buyer taking pre-possession.
What Happens if the Deal Falls Through?
This is usually addressed in the pre-possession agreement between the buyer and seller. Generally speaking, the buyer will have a pre-determined amount of time to close on the property, and if they fail to do so they have set guidelines in the agreement that dictate how long they have to vacate the property if the transaction doesn't close, as well as any fees associated with staying past the agreed upon vacate time.
Interested In Learning More About the Pre-Possession Process?
There are few real estate teams with the level of experience we have in dealing with pre-possession agreements. If you'd like to talk to one of our team members about the process, contact us today »